Brokers = low rates?
- Thread starter loaders
- Start date
20
Hmmm ... all depends who you are doing your quoting with. It's not likely they are getting rates for their own trucks for the simple reason if they have their own trucks, they already know what costs are, and really do not need your input ... agreed?
On the other hand, if you are quoting against Driver Inc., and are not Driver Inc. yourself, you are never going to win a bid.
On the other hand, if you are quoting against Driver Inc., and are not Driver Inc. yourself, you are never going to win a bid.
30
If you don’t like quoting rates, you might want to find another line of work. Just like fishing, you have to keep your lure in the water to catch fish. You will never have to worry about constantly quoting rates if all you have are contract customers where rates are negotiated once a year, however most carriers rely on the spot market for some of their business and as a result, need to quote on different lanes to get these shipments. Yes, it can be time consuming and definitely repetitive, but it’s just part of the job.
10
I know a lot of carriers will complain about load brokers with their low balling but what about when it was the opposite and carriers were asking for unreasonable amount of money?
I enjoy working with regular carriers and believe in having good relationships and working together to come to reasonable rates depending on the market but then you have those other carriers that cry and beg for loads when they need you and ghost you when they don't and get the bigger dollar from the one-off broker who may or may not pay them...
I enjoy working with regular carriers and believe in having good relationships and working together to come to reasonable rates depending on the market but then you have those other carriers that cry and beg for loads when they need you and ghost you when they don't and get the bigger dollar from the one-off broker who may or may not pay them...
I agree it does go both ways. but brokers also have to let carriers survive too.
From a brokers POV it is tough because why wouldn't they give the load to someone whos taking it for so low? From a carriers POV, either you take the load for the low rate being offered or let another carrier take it and now your truck is sitting.
Funny how supply & demand shifts things so strongly in this industry.
Funny how supply & demand shifts things so strongly in this industry.
20
Hahaha ... that's funny. It definitely does not go both ways.
Carriers without brokers have a chance at small to moderate local success.
Brokers without carriers get really good at playing Call of Duty.
"but brokers also have to let carriers survive too."
Brokers have absolutely nothing to do with whether or not you, as a carrier, survive. You are the captain of your own ship. You decide your fate, not a load broker, not another carrier. You, and you alone. No one else.
I have asked it a zillion times ... when will people realize that load brokers are not responsible for a carrier's success or failure?
@XPORTIN ... you make it sound like sitting a truck is a terrible thing, like it is some sort of taboo. Context my friend. Context. In reality it depends on the situation.
If I am going to lose $100.00 by taking a shit paying load, or only lose $50.00 by sitting ... I'll sit. That's just good fiscal management. On the other hand, if I am going to lose $100.00 on a shit paying load, but it takes me somewhere I can make an extra $200.00, then I'll turns wheels because overall, I'll make $100.00 instead of losing $50.00. That's even better fiscal management.
Seems to change by the minute. I dont think the left hand ever know what the right hand is doing
You have some good points. But I do believe letting a truck sit is worse then bringing it back empty sometimes.
15
It comes down to "who" is booking the trucks. Sure it makes sense if you are fully in control of your business from a #'s standpoint like most presidents/CFO/CEO are. However, people that book these loads may not have an understanding of fiscal management or having an understand the cost of running the business. They are there primarily to book loads, eliminate downtime on the drivers, and keep the wheels rolling.
20
I would beg to differ. If you are in the C-Suite it's your job to see that those who are booking loads are doing so in compliance with your fiscal management vision.
If you're just allowing your staff to book loads willy-nilly without a thought towards financial responsibility, you must answer the question "What value do you as the president/CFO/CEO, or even owner, bring to the table?". The answer, in that particular case, is you are dead weight. You bring nothing of value to the table.
30
The answer really depends on the strategy of the broker. Generally a smaller broker that is purely a broker will either be cheap or handle shipments that not everyone will handle. Larger brokerages will look at things from more of a contract standpoint and many times the brokerage is part of a larger solution being offered to the client.
When I was selling, I did very little spot freight because it could only be sold on price. The more collaborative relationships allow to make some money on the freight while being good to the carrier partners. For the brokerage, it is a higher cost of acquisition of the customer but in the end a better relationship on both the customer and carrier side.
Truth be told, it's why I got out. Too many brokerages are expecting a very quick turn-on of freight which means you have to go to the bottom feeders to get it. I would only offer a low price alternative on something that was a strategic fit on the asset side of our business.
When I was selling, I did very little spot freight because it could only be sold on price. The more collaborative relationships allow to make some money on the freight while being good to the carrier partners. For the brokerage, it is a higher cost of acquisition of the customer but in the end a better relationship on both the customer and carrier side.
Truth be told, it's why I got out. Too many brokerages are expecting a very quick turn-on of freight which means you have to go to the bottom feeders to get it. I would only offer a low price alternative on something that was a strategic fit on the asset side of our business.
30
"Collaborative relationships".....that my friends, is the name of the game!
30
In a word, NO. Perhaps I'm an outlier.. There's a big risk in quoting competitive: you get the freight and are expected to move it. I would much rather quote high.. get the freight.. and have no trouble moving it than being "competitive" and having to spend all day on the phone begging/humouring/cajoling carriers into taking my freight. Or worse... having to go back to the shipper at the 11th hour with apologies for not being able to cover the load. But having said that.. we've all been there: we quoted what we thought was a good rate only to discover we were way off and too low. It's embarrassing when that happens.. and the only remedy to that is to quote it a little bit higher than what you might consider an almost worst case scenario. I get turned down all day long for rates that are "uncompetitive", and I'm ok with that. The rate moves the load..
20
Amen brother ... Amen.
I am always reminded of the Heinz bid process many, many years ago. A third party "bidding" company organized a Dutch auction style of bidding competition (they were all the rage at one point in history). They invited every carrier they could find registered anywhere. The bidding, which should have ended after no more than 2 rounds, kept going lower and lower and lower until nobody wanted to play anymore. The last guy standing won the contracts. He was a basement dwelling load broker out of Newfoundland.
This guy has no assets. To win the contracts, he had to go lower on the rate than the asset based carriers themselves were willing to go. He now has to go back to these same carriers, offer them less than they were willing to go during the bid process, and try to keep 10% of that for himself.
Needless to say, this did not work out at all. The broker actually stayed at it for a couple years, and he apparently made a couple dollars. However, he gave about 97% of the loads back to Heinz to source their own trucks, and of the 3% of loads that the broker did, none of them were ever on time.
The bidding company went belly up.
The load broker closed up.
And, Heinz spent millions and millions over their transportation budget. So frustrated, they simply fired everyone in Leamington and moved the plant to Pittsburgh.
30
The auction style bidding seems to be making a comeback. Round one is all about quoting reasonable.. round 2 is all about quoting in faint hopes that one or two lanes are going to be workable.. round three is all about (WTF?) maintaining some semblance of dignity, and round four, if you've made it that far, is all about how far you can bend over.
20
20
yes it is - unforntnately I can see no positive in this - would be funny if it works like an art auction ... highest bidder gets the lane lol